On July 23, sanofi released a statement expressing concern about FDA’s decision to approve a generic version of Lovenox because of the “potential implications for patient safety.” Sanofi said the generic version, manufactured by Momenta Pharmaceuticals (Cambridge, MA) and Novartis’s generic-drug unit, Sandoz (Broomfield, CO), was not subject to the same extensive testing for safety and efficacy that Lovenox has undergone and therefore cannot be considered an equivalent drug. “By nature, Lovenox is a complex biological product and its efficacy and safety profile relies heavily on the strict adherence to the specific processes applied in its manufacturing as well as its traceability from the animal mucosa to the finished product,” according to the company statement.

FDA’s announcement of the drug’s approval acknowledges the challenges in producing the generic version and emphasizes that the appropriate precautions were taken before making its decision. “Before approving generic enoxaparin sodium injection, we expected, among other things, a series of sophisticated analytical tests and a study in healthy volunteers to assure that the drug would be as safe and effective as the brand name product,” said Keith Webber, PhD, deputy director of the FDA’s Office of Pharmaceutical Science. 

Early this week, sanofi filed a lawsuit in the United States District Court for the District of Columbia seeking to overturn FDA’s approval of the generic Lovenox. Momenta Pharmaceuticals released an update on Tuesday that said sanofi’s suit sought a temporary restraining order and preliminary injunction forcing FDA to suspend and withdraw its approval of the abbreviated new drug application filed by Momenta and Sandoz. The court set a date for a hearing on Aug. 17, and in the meantime there are no restrictions on Momenta and Sandoz to market their generic version of enoxaparin sodium injection. The companies say they plan to “vigorously oppose” sanofi’s suit.

In other sanofi news, reports around the web, such as this one from the New York Times, speculate that sanofi is on the verge of making an unsolicited $18-billion bid for Genzyme. The bid represents an offer of roughly $70 per share of the Cambridge, Massachusetts-based biotech firm. Analysts are eagerly awaiting the release of a letter from sanofi detailing its offer for Genzyme. Rumors of the deal have been circulating for several weeks, as PharmTech editor Patricia Van Arnum described in her blog post from early July.

Late 2008: The so-called “phantom recall” took place, in which J&J allegedly hired contractors to pose as customers and buy a certain type of adult Motrin in order to remove the product from store shelves. The House Committee on Oversight and Government Reform is currently investigating J&J’s actions in regards to the removal of the product from stores.

November 2009: McNeil recalled five lots of Tylenol Arthritis Pain Caplet 100 count bottles because of an unusual smell or taste. Nausea and related symptoms were reported by consumers.

December 2009: McNeil expanded the November recall to include all lots of Tylenol Arthritis Pain 100 count because of the unusual, moldy odor.

Jan. 15, 2010: McNeil recalled certain products, including Benadryl, Motrin, Rolaids, Simply Sleep, St. Joseph Aspirin, and Tylenol, because of the same musty, moldy smell identified in the November and December recall. The company determined that the odor was caused by the presence of a chemical called 2,4,6-tribromoanisole (TBA), which originated from the breakdown of a chemical used on the wooden pallets that stored and transported packaging materials for the medications. According to the company’s press release, the health effects of TBA have not been well studied, but no serious adverse events have been reported in the medical literature. McNeil said it would stop shipment of products that came in contact with packaging materials stored on the pallets and would also require suppliers to stop using the pallets.

April 30, 2010: McNeil announced that more than 40 types of children’s and infants’ products were voluntarily recalled because the products may not have met quality standards. McNeil advised that the medications not be given to children and infants, as a precautionary measure. Quality issues included the possibility of the medication containing too much of the active ingredient, containing substandard inactive ingredients, or containing tiny particles. The recall included more than 135 million bottles of children’s medication.

May 5: 2010: The House Committee on Oversight and Government Reform announced an investigation into McNeil’s April 30 recall.

May 6, 2010: McNeil closed its Fort Washington, Pennsylvania, facility in connection with the April 30 recall.

May 14, 2010: The Committee announced a hearing scheduled for May 27 to examine the circumstances of the April 30 recall.

May 25, 2010: JNJBTW.com, J&J’s blog, outlined an action plan that was developed with the help of a consultant designed to improve quality and manufacturing conditions at McNeil Consumer Healthcare. The announcement of the outline stated that a detailed version of the plan will be submitted to FDA by July 15.

May 27, 2010: The House Committee on Oversight and Government Reform held a hearing on the April 30 recall. Joshua Sharfstein, FDA’s principal deputy commissioner, testified on behalf of FDA. Colleen Goggins, worldwide chairman of Johnson & Johnson’s Consumer Group testified in place of CEO Bill Weldon, who was unable to attend because he was recovering from back surgery.

Documents produced at the hearing revealed what Committee Chairman Edolphus Towns dubbed a “phantom recall,” in which it appeared McNeil hired contractors to buy certain adult Motrin products. Towns later accused McNeil of initiating a formal recall only after FDA “discovered this covert activity” in a June 3, 2010, press release.

May 28, 2010: Blacksmith Brands, a provider of over-the-counter drug and healthcare products, voluntarily recalled four types of pediatric medications that were manufactured at the Johnson & Johnson/McNeil Consumer Healthcare plant at Fort Washington, Pennsylvania.

June 2, 2010: Towns requested information from J&J about its “phantom recall” of Motrin in 2008. Also, Towns requested information from Blacksmith Brands about its May 28 recall of products manufactured by J&J.

June 3, 2010: Towns requested information from the contractor allegedly hired by J&J in the so-called “phantom recall.”

June 15, 2010: McNeil expanded its Jan. 15, 2010, recall to include five more lots of Benadryl and Tylenol that were “inadvertently omitted from the initial recall action,” according to a company release. The additional lots were recalled for the same unusual odor that caused the January recall.

June 22, 2010: CEO Bill Weldon was asked by the Committee to testify at a second hearing about the company’s recalls. A date was not set for the second hearing.

July 8, 2010: McNeil issued another recall related to the moldy, musty odor of the Jan. 15 recall. Twenty-one lots of certain Benadryl, Children’s Tylenol Meltaways, Motrin, and Tylenol were recalled as a precautionary measure. McNeil says that an ongoing internal review showed that these products could have come in contact with the pallets that contained TBA, and therefore could have the foul odor.

Also, five complaints filed in the U.S. District Court for Northern Illinois against McNeil are seeking class-action status. Consumers accused McNeil of fraud and racketeering for not recalling all of its children’s products and for not adequately reimbursing consumers for their out-of-pocket expenses.

July 15, 2010: J&J intends to share its detailed action plan for improving quality with FDA.

McNeil’s January 2010 recall affected several of its over-the-counter products, including Benadryl, Motrin, Rolaids, Simply Sleep, St. Joseph Aspirin, and Tylenol. The company also recalled lots of Tylenol Arthritis Pain 100 count with EZ-Open Cap in December 2009 because of the same odor. After an investigation following the Jan. 15 recall, the unusual odor was attributed to the presence of a chemical called 2,4,6-tribromoanisole (TBA). McNeil concluded that the TBA came from a chemical used on the wooden pallets that stored and transported packaging materials for the medications.

Specifically, the five newly recalled lots include: four lots of Benadryl Allergy Ultratab tablets, 100 count, sold in the US; and one lot of Extra Strength Tylenol Rapid Release Gels, 50 count, sold in the US, Trinidad and Tobago, Bermuda, and Puerto Rico, according to Tuesday’s press release.

The company’s latest announcement comes in the wake of a Congressional hearing and investigation about its April 30, 2010, of more than 40 infants’ and children’s products. The US House Oversight and Government Reform Committee also uncovered what Chairman Edolphus Towns called a “phantom recall” in which it appears Johnson & Johnson hired contractors to systematically remove certain Motrin products from store shelves in late 2008. Towns asserted that J&J initiated a recall only after FDA was made aware of the company’s actions, and earlier this month asked the contractors to provide details of their activity in the situation.

The New York Times reported last week that the committee and J&J disagree about their interpretations of the events of the “phantom recall.” J&J says nothing was wrong with the way it removed the products from stores and that there was no safety risk in the products. By not issuing a recall, the company wanted to take the product out of stores “with as little disruption and consumer confusion as possible,” said a McNeil spokesperson quoted in the NYT article. NYT obtained a July 2009 email from an FDA official to a McNeil executive that said, “It seems that your company is doing a recall even though you are calling it a ‘retrieval.’ The agency’s position is that your company should do a voluntary recall of the product since it appears to be that you are already doing a recall of the product.”

In his closing statement at the May 27 hearing, Towns said he would introduce legislation that would give FDA mandatory recall authority and the power to halt drug production. Do you think FDA should have this authority? The the results of PharmTech’s poll on the topic, available here.

The McDonalds recall is the fourth cadmium-related recall issued by CPSC this year for children’s products. Cadmium is one of the four major toxic elements of concern in consumer products. Together with lead, arsenic, and mercury, these make up “the big four” heavy metals that pose the greatest threat to our health.

The pharmaceutical industry has been reworking guidelines for limits and testing methods in an attempt to keep tabs on heavy metals. As Managing Editor Angie Drakulich discussed in her post last week, FDA recently focused its attention on the amount of lead contamination in dietary supplements. Legislation is under review in the Senate that could give FDA the power to regulate supplements and better control the amount of heavy metals they contain. Additionally, the US Pharmacopeia and ICH are working to update guidelines relating to heavy metals and keeping them out of pharmaceutical products.

For more on heavy metals testing requirements, register for Pharmaceutical Technology’s webcast scheduled for next week on June 14 and 17.

The physician’s reassurance could come as comforting news to parents who may have given the affected medications to their children. Or, these new details about the seeming lack of manufacturing controls could shake consumers’ confidence in McNeil even more. As previously reported in PharmTech’s ePT, McNeil, a division of Johnson & Johnson, voluntarily recalled more than 40 variations of infants’ and children’s over-the-counter medications on April 30. The products were recalled because some may contain a higher concentration of active ingredient than is specified, others may contain inactive ingredients that may not meet internal testing requirements, and others may contain particles, according to McNeil. The company said the recall was precautionary and that no adverse events had been reported. The April 30 recall was the third in the past year, following a January 2010 and December 2009 recall of Tylenol and other products that contained a moldy, musty odor.

On May 5, the House Committee on Oversight and Government Reform said that it would investigate McNeil’s most recent recall to clarify some of the details because of discrepencies in the information the committee received from McNeil and FDA. According to a committee press statement:

“FDA and McNeil Consumer Healthcare have given conflicting accounts of the circumstances surrounding the recall, including what prompted the recall and how serious the recall is. In addition, as this is the third recall of Tylenol products in less than a year, the lawmakers are questioning the adequacy of FDA’s inspection procedures and whether McNeil failed to investigate consumer complaints that could have identified the contamination problems.” 

Last week, the committee announced that a hearing is set for May 27. In letters posted on the committee’s website, Chairman Edolphus “Ed” Towns (D-NY) invited William C. Weldon, chairman and CEO of Johnson & Johnson, and FDA Commissioner Margaret Hamburg to testify at the hearing. However, according to J&J’s blog, JNJBTW, Weldon had back surgery yesterday and will not be able to attend the hearing. The company will send Colleen Goggins, worldwide chairman of the consumer group to the hearing in Weldon’s place.

The program outlined how market dynamics are shifting the strategies of innovator-drug and generic-drug companies. The “patent cliff,” so named because of the expected revenue fall of major drug companies as they face patent expiration of key drugs, the decline in new product introductions, ongoing cost-containment efforts in healthcare expenditures in established markets in the US and Western Europe, and pharmaceutical industry growth in emerging markets, have laid the foundation for the pharmaceutical majors to reevaluate their diversification strategies, position in generic drugs, and approach—from a cost and revenue perspective—on how to capitalize on growth in emerging markets. At the same time, the major generic-drug companies have to decide how to best avail themselves of the large opportunity resulting from the wave of patent expiries as well as their own diversification into new drug development.

For innovator drug companies, one consequence of these changing market fundamentals is the strategic tide toward diversification is returning. During the last two decades or so, several pharmaceutical majors divested noncore assets in areas such as agricultural chemicals, consumer healthcare products, nutritional products, and animal-health businesses to strengthen their strategic emphasis as pure-play human healthcare companies focused on new drug development. The pendulum is shifting somewhat again, and one way is which this trend is evident is how innovator-drug companies are more focused on creating a strategy for established products, including generic drugs. These strategies by innovator-drug companies are no being longer shaped exclusively by traditional approaches in generic-drug defense or product life-cycle management, but are inclusive of the role that established products (i.e., drugs late in the product life cycle or generic drugs) play in the overall market, especially in emerging markets. At the same time, the opportunity for drug companies for established drugs is broadening to include not only small-molecule solid-dosage forms but also injectables and biosimilars.

Several publicly announced deals between Big-Pharma companies and drug/manufacturing companies in emerging markets reflect this trend. For example, last week, AstraZeneca signed a license and supply agreement with the Indian drug company and manufacturer Torrent Pharmaceuticals, under which Torrent will supply to AstraZeneca a portfolio of generic medicines for emerging markets. In 2009, GlaxoSmithline (GSK) partnered with India’s Dr. Reddy Laboratories under which Dr. Reddy will manufacture and supply drugs to GSK, which will license and comarket the drugs in various countries in Africa, the Middle East, Asia-Pacific, and Latin America. In December 2009, GSK extended its strategic relationship and acquired a 19% stake in the South African pharmaceutical company Aspen PharmaCare to serve emerging markets.

Earlier this year, Pfizer formed a collaboration with India’s Strides Arcolab under which Pfizer will commercialize off-patent sterile injectable and oral products in the US. The finished dosage-form products will be licensed and supplied by Strides, Onco Laboratories, and Onco Therapies, two joint ventures between Strides and Aspen PharmaCare. And in 2009, Pfizer partnered with two Indian pharmaceutical manufacturers: Aurobindo Pharma and Claris Lifesciences. Under the deal with Aurobindo, Pfizer acquired the rights to 55 solid oral-dose products and five sterile injectables in 70 emerging markets and will commercialize those products. Pfizer also acquired the rights to 15 generic injectables from Claris Lifesciences.

Also, sanofi-aventis enhanced its generic-drug portfolio and position in in emerging markets during the last two years with several acquisitions of generic-drug companies: Zentiva (Czech Republic), Kendrick (Mexico), and Medley (Brazil). In 2009, Sandoz, the generics arm of Novartis, added to its generic-drug portfolio by acquiring the generic oncology injectables business of EBEWE for EUR 925 million ($1.3 billion).

So what is the takeaway? Continue to watch how innovator-drug companies’ models for established products shape their strategies in product life-cycle management and emerging markets.

Two goals of the consortium are now getting underway. First, Rx-360 announced earlier this week that its members are beginning to share existing sponsor audits through its shared-audit pilot program. The pilot involves 30 suppliers around the world. Because the number of audits a drug sponsor is required to conduct can be in the thousands, obtaining information from other companies who have already conducted an audit at a particular facility may provide very useful information. With this additional information, a company may be able to conduct a shorter, less-intrusive audit on its own—or forego one altogether—thus, saving time and money.

During Rx-360 talks, some industry members have said it’s no problem to look at other companies’ audits—everyone likes free stuff—but the idea of handing out their own audits is a bit more challenging, especially in an industry so flooded by IP rights and patent protection. It will be interesting to see in the coming months how useful the sharing of audits is and whether more companies become more wiling to share their information.

The second achievement for the consortium, also announced by the group this week, involves the adoption of audit standards. Since the beginning, Rx-360 has said it intends to adopt already existing, qualified standards and guidelines rather than setting its own. The consortium will only develop standards in areas where it feels there is a need. For example, groups such as IPEC already have many useful guidelines related to the supply-chain that have received input and approval from FDA and are being used by industry.

The consortium has an Audit Standards Working Group with 27 participants, representing 19 companies and organizations. The group is looking at standards for APIs, excipients, supply-chain security, basic chemicals, packaging, and print. The standards will be used in a pilot to prove the auditing process, according to Mar. 3 Rx-360 release.

See related blog posts:

Is Industry Ready to Share Supplier Audits? Rx-360 Takes a Shot

Rx-360 Takes on Europe, Talks to PharmTech in Podcast Series

Exhibitors and attendees pointed to different trends among their customer bases. For the Big Pharma companies, exhibitors and attendees shared two key observations. Many said they have seen increased receptivity and interest among the large pharmaceutical companies in outsourcing compared with previous years, largely driven by the large pharmaceutical companies’ interest in improving their own cost structures and using external development and manufacturing to achieve that goal. That same cost-consciousness, however, is leading pharmaceutical companies to manage their inventories more tightly. Contract manufacturers reported that destocking by the large companies, including generic-drug companies, has resulted in fewer new orders and greater competition for the fewer new orders that may become available.

The news from the small to emerging pharmaceutical companies is also subdued. There was widespread agreement among contract players that the tightening of credit and more cautious investor activity in the pharmaceutical/biopharmaceutical sector has pressured smaller companies to reduce their product development portfolios, proceed in a more step-wise fashion for the projects that remain, or in some cases, has resulted in a liquidity crunch that has forced consolidation or driven certain smaller drug companies to cease operations. As one company put it, “Things are better than they were last fall, but it is still difficult for the smaller companies. We haven’t seen business return to levels before the financial crisis.”

A recent Pharmaceutical Technology poll mirrors those sentiments expressed at CPhI. In a poll conducted Sept. 30 through Oct. 14, 2009, a majority of respondents, 56%, characterized the current market for contract small-molecule manufacturing as “fair” to “flat.” Thirty-four percent rated the market as “fair,” defined as growth between 1–3%, and 22% said that growth in the current market was “flat,” representing no growth year-over-year. Nine percent said the market was “poor,” defined as negative growth year-over-year. Reflecting some signs of optimism, however, 35% of respondents classified the market for contract small-molecule manufacturing as “moderate” (defined as growth of 3–5%) to strong (growth of greater than 5%).

Another positive indicator comes from IMS Health, which raised its growth projections for the global pharmaceutical market for 2010. The market research firm expects the global pharmaceutical market to grow 4–6% in 2010, reaching more than $825 billion. Looking ahead to 2013, the industry can expect a 4–7% annual growth rate with the global market reaching more than $975 billion. This forecast represents a 1% increase in IMS’s five-year global market estimates released earlier this year. Particularly encouraging are positive signs from the US pharmaceutical market, where pharmaceutical market growth is expected to be 4.5 to 5.5% in 2009 and 3 to 5 % in 2010.

Broader issues, such as the extent of the global and US economic recovery and the possible passage and impact of healthcare reform in the US, as well as pharmaceutical industry-specific issues, such as the impact of recent consolidation and restructuring among the pharmaceutical majors and financing trends in the pharmaceutical/biopharmaceutical sector, will be key barometers to watch in the upcoming months in tracking the future health of pharmaceutical outsourcing.

Former IPEC Chair Dave Schoneker also issued a call to action to industry members. He called on IPEC user companies to “qualify and audit all their suppliers” and to “stop making excuses” about why they can’t do so. “We’re IPEC global, we can’t wait for the regulators and the legislation—that will take years—and people are dying today. We’ve been talking about this [securing the supply chain] since 1995, and frankly, I’m tired of it,” he said.

Schoneker continued, aiming his directives at excipient suppliers. “Start marketing GMP,” he said. “Start getting audited and certified and sell based on your GMP expertise. Forget about using price as a main competitor—instead, prove to your customers why they should buy from you.”

FDA’s Edwin Rivera Martinez of CDER, also a speaker at the conference, didn’t take these calls from industry lightly. He agreed that there are great challenges in assuring integrity of the pharmaceutical supply chain and that manufacturers can’t rely on FDA for all their audits. FDA’s audits are infrequent he said and may not cover all the processes manufacturers need to look at for their specific products.

In terms of solutions, he said that FDA would like to see one national, electronic pedigree requirement to help secure the supply chain. He also noted that industry can take advantage of ICH Q7 and other available guidelines such as the GMP excipient guideline. Martinez’s colleague, Steven Wolfgang of the Office of Compliance at FDA, even pointed out that the agency can recognize certified third-party audits to help the industry through its growing global challenges.

Martinez did throw a bit of a scare to the audience though when he brought up show and shadow factories that put on a front of doing real manufacturing when they are actually buying product from other sites and reselling or repackaging the materials. FDA issued warning letters to two such facilities in China this past summer. Some red flags to watch for, he said, include discrepancies in date (e.g., compare when the materials arrived versus when production and testing were done) and if the facility happens to be “renovating” or “not manufacturing the day” you are there for your audit. You have to see the product being manufactured in action, he suggested. You can also ask to see batch records and other documentation as proof the factory is indeed operational.

Schoneker added that he discovered a shadow factory in England several years ago—so it’s important to recognize that these activities can occur anywhere.

Industry and regulatory presenters at the conference were in agreement that more needs to be done—and now—to help prevent future supply chain breaches. In fact, they seem to be getting closer and closer in thought about exactly how to do it. The next few months will be quite interesting to watch as consortia such as Rx-360 and certified auditing programs such as IPEA move forward—with regulatory acceptance likely following their efforts.

For instance, Skutnik reported that IPEC is now working to convert all of its guidelines to ANSI standards. Because there is no regulatory enforcement of excipients, this step will at least provide excipient guidelines that a broader public can use and that have been developed via consensus. Also of note, the IPEC Federation is now operational, representing the various regional IPEC organizations such as IPEC–Americas, IPEC–Europe and other IPEC offices that have opened recently, such as IPEC–China (and soon to exist IPEC-India). The mission of IPEC remains the same—to focus on the safety, functionality, and quality of excipients for the pharmaceutial industry—but there will now be one voice to represent those goals.

This morning’s session was largely off the record, featuring talks from a senior health advisor to the Senate HELP Committee and representatives from other administrative and congressional bodies. But the message from the audience was clear—the excipient industry wants to be regulated, they want stronger enforcement. Don’t assume that we’re afraid of extra costs, said former IPEC Chair Dave Schoneker, of Colorcon. If the pharmaceutical excipient industry can make things safer and better for the public by having increased standards and regulations, then they’re willing to take it on. Schoneker also noted that Congress should not assume excipients are less risky because they’re “inactive.” For example, think of how many individuals died from exposure to DEG (going on 900) versus melamine and heparin, he said.

Another speaker focused on the current administration’s goals and how there is more momentum now to secure the pharmaceutical supply chain at the borders. The extra push for technology to create solutions to current problems from the Obama team is also at play. There are multiple proposals in Congress, and with FDA’s (slightly) increased budget and new leadership, pharmaceutical manufacturers (including excipient users, suppliers, and distributors) are in for change in the coming years. But the audience here in Washington seems more than ready to welcome those changes if it means securing the supply chain once and for all.

Of note, this will be the last standalone IPEC regulatory conference. Starting in 2010, the Council is partnering with ExcipientFest to hold a joint conference on excipients, offering similar topics but in a bigger and better way.